Net Neutrality Ruling Likely to Alter Web Business Models

Jan 15, 2014 5:45 PM PST

WASHINGTON — In a ruling that could likely mean different consumer prices for content and not just speed, the U.S. Court of Appeals for the District of Columbia sent rules governing what’s known as net neutrality back to the FCC, saying the agency overreached in barring broadband providers from slowing or blocking selected web traffic.

Both critics and proponents agree that new rules that likely come out of the ruling could alter the Internet's basic business model. And, in turn, potentially affect how adult entertainment is distributed over the web, including the streaming of 4K Ultra HD TV services.

Yesterday's decision could allow Verizon Communications Inc., the appealing party in the case, and other Internet service providers to charge more for movies delivered over broadband to their customers.

U.S. Circuit Judge David Tatel, writing for a three-judge panel, said that while the FCC has the power to regulate Verizon and other broadband companies, it chose the wrong legal framework for its open-Internet regulations.

“Given that the commission has chosen to classify broadband providers in a manner that exempts them from treatment as common carriers, the Communications Act expressly prohibits the commission from nonetheless regulating them as such,” Tatel wrote.

The FCC's 2010 rules, which now have to be reworked, required ISPs that use fiber-optic or other cable to treat all traffic equally and disclose their network practices.

With the decision, the fear among net neutrality supporters is that absent strong regulations requiring ISPs to treat all traffic equally, the Internet will become divided.

ISPs could let big Internet companies pay for faster Internet service and pass those costs on to their customers, while other online companies are stuck at slower speeds. Or they could block access to certain apps or web services that compete with their own.

Or consumers who spend more time streaming or downloading big files over the Internet could be hit with the bill.

Attorney Greg Piccionelli will discuss implicications of the ruling for the adult industry in February's edition of XBIZ World.

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